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Last Wednesday night a lawsuit brought by a consolidation of U.S. insurers was filed in the U.S. District Court in Manhattan, suing ten Saudi Arabian companies for at least $4.2 billion due to their alleged complicity in the September 11, 2001 attacks on the United States. This case, Charter Oak Fire Insurance Co et al. v Al Rajhi Bank et al., is the most recent step in a lengthy legal and political battle over the culpability of Saudi Arabia in Al Qaeda’s horrendous actions. Since the Saudi government holds a financial stake in at least one of the corporations named in the lawsuit, it could not have been filed without the passage of the 2016 Justice Against Sponsors of Terrorism Act (JASTA).

JASTA removed the legal immunity of foreign states, or sovereign immunity, from liability claims by U.S. nationals in cases where state actors aided and abetted “an act of international terrorism in the United States” or conspired with those responsible. Although the JASTA received unanimous support from the highly polarized 114th Congress, it was decried by the Obama Administration and the foreign policy community, and stands out as the only successful veto override in Obama’s eight years as president.

I cannot and will not make any claims regarding the culpability of these specific companies in supporting, either actively or passively, the Al Qaeda organization. I will use the opportunity provided by this landmark case to discuss the potential ramifications of JASTA on both international diplomacy and the future of state sponsorship of terrorism.

JASTA dramatically widens the range of governments that can be sued in U.S. courts for providing support to organizations engaging in terrorism. Prior to the passage of JASTA only states that were formally labeled and sanctioned as State Sponsors of Terrorism (currently Iran, Sudan, Syria, and North Korea) could be held financially liable for their support of violent non-state actors. However, many other states have supported terrorist organizations by directly giving these groups resources and safe haven or tacitly allowing them to recruit and fund raise within their borders.

On its’ face JASTA is a tremendous boon to both justice and counter-terrorism efforts, enabling American individuals and corporations harmed by terrorist attacks to gain financial recompense for their losses, and punishing states that are culpable in violence directed towards American citizens. In theory, by increasing the potential costs of sponsorship, JASTA may play an important role in reducing the number of state sponsored terrorist organizations by incentivizing state actors to refrain from such behavior in the first place.

At the same time, there are deep foreign policy concerns associated with removing sovereign immunity, contributing to the controversy around JASTA and the decision by the Obama Administration to veto this legislation. Many states that could conceivably be targets of private litigation resulting from JASTA (including Saudi Arabia) are partners in American-led counter-terrorism efforts. By making the governments of these states financially liable for past or indirect sponsorship, the U.S. runs the risk of angering these allies, jeopardizing often fragile counter-terrorism alliance structures.

Eliminating sovereign immunity for terrorism sponsorship also creates the precedent for other states to respond in kind: a shift in international norms that could potentially prove costly for the United States in the future. The United States has had a complicated history with supporting violent non-state actors, actively sponsoring anti-communist organizations during the Cold War and passively supporting ethnic-nationalist groups like the Irish Republican Army. Although American incentives to support these groups have diminished in recent years, it is entirely possible that this is a temporary trend, and in the coming decades the United States could find itself the defendant in a foreign lawsuit similar to Charter Oak Fire Insurance Co et al. v Al Rajhi Bank et al.

As a result, we are faced with two widely divergent outcomes to JASTA, and the potential for the Act to dramatically impact foreign policy in the future. If we believe that state sponsorship, whether active or passive, is declining in the international system, the Justice Against Sponsors of Terrorism Act has the potential to serve as the final nail in its coffin, decreasing the incentives for states to support or condone terrorist violence. Alternatively, if we believe that sponsorship will continue to be observed at the present or a higher rate, the disruption of sovereign immunity may engender deeper suspicion and hostility between nations.

Jeremy Berkowitz is a Ph.D. Candidate in Political Science at Binghamton University.